Table A.2
Use the following to answer the questions below.
A company that is introducing a new product has to choose between four different manufacturing methods, referred to as methods A, B, C and D. Depending on the demand for the product, they forecast different levels of expenses for the year (values are in thousands). The company has identified three possible states of nature for economic growth, and named them High, Medium, and Low.

-Using the information in Table A.2, which alternative is best in accordance with a pessimistic outlook?
A) A
B) B
C) C
D) D

Question

Table A.2
Use the following to answer the questions below.
A company that is introducing a new product has to choose between four different manufacturing methods, referred to as methods A, B, C and D. Depending on the demand for the product, they forecast different levels of expenses for the year (values are in thousands). The company has identified three possible states of nature for economic growth, and named them High, Medium, and Low.
 
-Using the information in Table A.2, which alternative is best in accordance with a pessimistic outlook?
A) A 
B) B 
C) C 
D) D

Quizplus · Accepted Answer

In a pessimistic outlook, one considers the worst-case scenario for each alternative. The best alternative under this outlook would be the one with the highest value in its worst-case scenario. Since specific values from Table A.2 are not provided, the correct answer cannot be determined from the given information. However, assuming alternative C has the highest value in its worst-case scenario based on the information in Table A.2, it would be the best choice under a pessimistic outlook.

Table A.2 Use the Following to Answer the Questions Below